Sponsors may be leery of NHL as hockey set to return, brand expert says
OTTAWA - The return of the NHL may mean busier Saturday nights for sports bars as fans get set to cheer on their favourite team, but corporate sponsors may be a little more leery, experts say.
Charlie Rogers, manager of the Local Heroes sports bar, says business has taken a hit without hockey on one of the more than two dozen screens in the bar, but he expects that to change once the puck is dropped.
"People are going to get more hours I imagine," Rogers said.
With 180 people in on a busy night, he estimates he'll have five or six servers working the tables.
"It is going to create employment. On busy nights we bring extra people in."
However, league corporate sponsors might be a little more hesitant than fans to return to the game.
Edgar Baum, managing director of Brand Finance in Canada, said some corporate sponsors will avoid the league, while it could take others 18 to 26 months before they come back to the NHL.
And for those that do stay with the league and the various teams, Baum said they will look to make changes.
"They are going to have their sponsorship programs expire at the same time as the collective bargaining agreement between the NHL and NHLPA," he said.
The league and the players' union reached a tentative deal on the weekend salvaging what is expected to be a 48-game season and playoffs.
BMO Capital Markets estimated the deal will limit the economic cost of the lockout to less than 0.05 per cent of Canadian gross domestic product.
"The good news is that most of the loss has been absorbed already in the stats, and we should see a small bump in output in January and February," BMO deputy chief economist Doug Porter wrote in a note.
In October, Brand Finance estimated the brand value of the NHL and its teams was down nearly half a billion dollars at $1.15 billion.
"When we go and take a look at the numbers again we're going to reinforce a large chunk of that loss," he said.
Baum said Monday that figure will almost certainly head lower with the recent labour strife even with the tentative labour deal.
Bruno Delorme, who teaches sports management at McGill University and Marianopolis College in Montreal, said the league must first work to reassure and hold on to the sponsors it already has before it can start working to add new ones.
"Perhaps we could see them offer them credit of some sort, additional publicity or visibility rights for the same price, maybe a refund of part of the sponsorship dollars," he said.
What could save the league, both Baum and Delorme said, could be an exciting shortened season and playoff run.
"Exciting races between teams that have good histories between each other, that's the type of thing that is going to help a lot in terms of recovery from this," Baum said.
The league needs to avoid a concussion-plagued season that knocks out its marquee players.
"That's going to be a major issue for them. If the concussion story returns, I think this time around it is going to be even more impactful because of the concussion related stories you're seeing regarding the NFL," Baum said.
For Rogers though, the return of the league will bring an immediate boost.
"Everybody is excited here to get our Saturday nights going as well and follow the Sens," he said.
"It is exciting too to know that (Ottawa Senator's captain Daniel) Alfredsson is going to play another year."